Recommendations To Facilitate Open Communications

Based upon experience, the following procedures have been helpful in facilitating communication during an examination.

Frequent meetings should be held to discuss the issuance of IDRs. In special circumstances, draft IDR may be issued prior to the meeting. Click on Information Document Requests (IDRs) to view a blank IDR.

The taxpayer should notify the IRS as soon as possible if the information requested is not clear.

An agreement should exist to provide information as soon as possible where documents are readily available, as well as an understanding in place to mutually extend the due date of IDRs where the established due date cannot be met. The taxpayer’s schedule and expected response time should be considered when documents are requested.

An agreement should exist for the IRS to advise the taxpayer promptly as to whether an IDR response is considered complete.

Participating In The Examination

There should be discussions at the beginning of the audit regarding the IRS priorities in the audit and the taxpayer’s resources in providing timely documentation.

The taxpayer’s management should be advised of the beginning of the audit and the resources that will be necessary to facilitate the timely flow of documentation to the IRS.

Use of E-Mail For Communication

IRM 1.10.3.2.1 (7) prohibits IRS employees from sending sensitive data by E-Mail to taxpayers or their representatives unless they are using a technology and methodology approved by the Security Services & Privacy Executive Steering Committee and the Senior Executive Team.

Discussion of Issue Proposals

Proposed issues should be discussed in advance of the issuance of Form 5701, Proposal of Examination Adjustments. Discussions generally will include facts, law, argument and the taxpayer’s position. These discussions help clarify both the taxpayer’s position and the IRS’s position in regard to the issue. In addition, the taxpayer is given the opportunity to provide additional information supporting their position regarding the proposed adjustment.